Reviewing Entergy Corporation (NYSE:ETR) & IDACORP (IDA)
Entergy Corporation (NYSE: ETR) and IDACORP (NYSE:IDA) are both mid-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, analyst recommendations, valuation, risk and dividends.
This table compares Entergy Corporation and IDACORP’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Entergy Corporation pays an annual dividend of $3.48 per share and has a dividend yield of 4.5%. IDACORP pays an annual dividend of $2.20 per share and has a dividend yield of 2.5%. Entergy Corporation pays out -69.7% of its earnings in the form of a dividend. IDACORP pays out 55.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Entergy Corporation has increased its dividend for 2 consecutive years and IDACORP has increased its dividend for 5 consecutive years. Entergy Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a breakdown of recent ratings and target prices for Entergy Corporation and IDACORP, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Entergy Corporation presently has a consensus price target of $78.25, suggesting a potential upside of 1.56%. IDACORP has a consensus price target of $75.00, suggesting a potential downside of 14.38%. Given Entergy Corporation’s higher probable upside, research analysts clearly believe Entergy Corporation is more favorable than IDACORP.
Insider & Institutional Ownership
82.5% of Entergy Corporation shares are owned by institutional investors. Comparatively, 78.7% of IDACORP shares are owned by institutional investors. 0.2% of Entergy Corporation shares are owned by insiders. Comparatively, 0.7% of IDACORP shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Risk and Volatility
Entergy Corporation has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500. Comparatively, IDACORP has a beta of 0.51, suggesting that its stock price is 49% less volatile than the S&P 500.
Earnings and Valuation
This table compares Entergy Corporation and IDACORP’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Entergy Corporation||$10.98 billion||1.26||$3.56 billion||($4.99)||-15.44|
|IDACORP||$1.30 billion||3.40||$438.95 million||$3.96||22.12|
Entergy Corporation has higher revenue and earnings than IDACORP. Entergy Corporation is trading at a lower price-to-earnings ratio than IDACORP, indicating that it is currently the more affordable of the two stocks.
About Entergy Corporation
Entergy Corporation is a holding company. The Company is an integrated energy company engaged in electric power production and retail electric distribution operations. The Company operates through two business segments: Utility and Entergy Wholesale Commodities. The Utility segment includes the generation, transmission, distribution and sale of electric power to retail and wholesale customers in areas of Arkansas, Mississippi, Texas and Louisiana, including the City of New Orleans and operates a natural gas distribution business. The Entergy Wholesale Commodities segment includes the ownership, operation and decommissioning of nuclear power plants located in the northern United States and the sale of the electric power produced by its operating plants to wholesale customers. As of December 31, 2016, the Company owned and operated power plants with over 30,000 megawatts of aggregate electric generating capacity, including approximately 10,000 megawatts of nuclear-fueled capacity.
IDACORP, Inc. is a holding company. The Company’s principal operating subsidiary is Idaho Power Company (Idaho Power). The Company’s segment is utility operations. The utility operations segment’s primary source of revenue is the regulated operations of Idaho Power. Idaho Power is an electric utility engaged in the generation, transmission, distribution, sale and purchase of electric energy and capacity. Idaho Power is the parent of Idaho Energy Resources Co. (IERCo), a joint venturer in Bridger Coal Company, which mines and supplies coal to the Jim Bridger generating plant owned in part by Idaho Power. Its subsidiaries also include IDACORP Financial Services, Inc., an investor in affordable housing and other real estate investments, and Ida-West Energy Company, an operator of small hydroelectric generation projects. As of December 31, 2016, Idaho Power provided electric utility service to approximately 535,000 general business customers in southern Idaho and eastern Oregon.
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